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David Frasure's 1992 BSDi Deposition - Part 2
Saturday, January 15 2005 @ 12:25 PM EST

Here is part two of the David Frasure Deposition from 1992 in the BSDi case. I wish to thank brooker for helping me with this transcript.

In part one, we saw AT&T's lawyer, Mr. Kennedy, try to dominate and belittle BSDi's attorney, Ms. Fithian, and here we see the U. of California's attorney, Ms. Shapeau, take her turn at questioning the witness, with Mr. Kennedy doggedly at her side. She asks Mr. Frasure about the August 1985 $ echo, so I am providing the link so you can follow along if you want to, and the Educational License. Part 1 of the Frasure Deposition is here.

******************************

Okay. This accurately reflects the general substance of the modifications that AT and T was going to be making to its software contracts.

A. Well, each one of these is just a one-sentence synopsis, so . . .

Q. Right. Okay. Okay. This accurately reflects the general substance of the modifications that AT&T was going to be making to its software contracts.

A. Well, each one of these is just a one-sentence synopsis, so . . .

Q. Right. Okay.

A. . . . you know, the language change wound up to be significant.

Q. Specific.

A. Yeah. But this was -- this was a highlight of items, yes.

Q. Okay. Now, the second paragraph states these changes are in response to direct feedback from AT and T -- AT and T's licensees and are intended to make the contracts more responsive to the needs of the licensees. And then there's a summary of a list of highlights.

Do you have a specific recollection -- well, let me -- let me strike that and go to the very last highlight on this page in the right-hand column which is entitled Clarification of Ownership of Derived Works, and the language of the highlight reads:

. . . Language changes will be made to clarify ownership of modifications or derivative works prepared by a licensee.

Could you describe for me what was meant by

101

this?

A. You mean the clarification?

Q. Yes.

A. Well, as I recall, and I -- and I think that as we looked at some of the agreements this morning there was a definition of a licensed product and it -- and it mentioned modifications and so on to it. And there was always a question -- I won't say always -- there was in -- in a large number of cases there was always a question as to who the owner of those modifications were, and similar to the letter that we saw this morning, there was a clarification made. And one thing that -- that we did is that if we found that we were continually doing the same thing over and over with a number of licensees, then that was a flag to us that the agreement should probably be changed to provide this clarification, so that's --that's what was meant by that.

Similar to the contractor provision up top, there was a number of licensees who always wanted to have -- take under contract with them, a company to perform work on their behalf, and it seemed like with most of the software agreements we were having to generate another agreement called Contractors' Provisions, so we just decided that we would give everyone that opportunity or that thing directly in the contract.

102

Q. Okay. And do you recall specifically the types of questions licensees were asking regarding - modification -- modifications or derivative works and the ownership thereof?

A. Well, I think the question was basically who - - who owns that -- that code. Again, you get into -- we would get into a -- a number of hypothetical cases when negotiating a contract. And if, you know, someone decided to revoke their license or suspend it, they would only to have to provide back to us the software product that we gave them or destroy that, but they were still bound by the -- by the agreement to preserve any knowledge of the product or -- or what they had gained from it. So all we were trying to do is to clarify that there was -- they owned the -- the modifications, any --any derivative or enhancements that they made to the product, but it was also going to be treated as part of the product.

Q. Okay. By they, you mean the licensee owned . . .

A. The licensee, yes.

Q. . . . modifications and enhancements of the product?

A. Uh-huh.

Q. Of the licensed software?

103

A. Of the licensed software. Then it, you know, it was just a clarification as regarding ownership and ownership only.

Q. Now your specific role in the modifications and clarifications to the licenses, and at this time I believe it was System Five, this time meaning in the mid-1985 time frame, could you just describe specifically what your role was with educational and commercial licenses and the clarification and modification of those licenses for System Five?

A. What my role was really to work with our internal attorneys, and again, in most of these cases it was Geoff Green who made the revisions to the contract. And we would convey to Geoff what -- what we would like to see in the contract, and then he would come up with a draft of words, and then we would massage it and modify it.

There were a number of occasions that we would ask a licensee to review that language to see if they felt like it covered what -- what they were after so there wouldn't -- the changed language would not spur any further changes of clarification. And so my role was really in the -- in defining what we were -- what we were attempting to do and -- and some of the restrictions or - - or the restrictions or whatever that would apply to

104

that.

Q. Okay. And so the modifications and clarifications that were made in the mid-1985's to the System Five license agreement Unix your role involved reviewing that language . . .

A. Yes.

Q. . . . and the modifications there, so you were familiar with those modifications and clarifications?

A. Yeah; I don't recall the words of what they were today, but I mean, I was involved in them.

Q. I understand. . .

MR. KENNEDY: Before we go into another document, I see this document has been designated by USL as financial confidential. I believe that's a mistake. Perhaps you could clarify and ask Mr. Frasure on the record whether he had an understanding about the availability of this document.

Q. (To Mr. Kennedy:) Do you -- to whom it was available?

MR. KENNEDY: Yeah, was . . .

Q. I think it -- it was available -- I think he actually mentioned that this was provided to AT and T licensees.

Is that right?

A. Yes, I think -- there used to be a statement

105

up front.

MR. KENNEDY: May I simply ask him whether --

Mr. Frasure, was distribution of the dollar sign echo publication limited to licensees, to your knowledge?

A. I don't know. I . . .

MR. KENNEDY: Okay. We'll -- we'll -- I don't want to delay any longer. We'll look into it, but . . .

MS. SHAPREAU: Okay.

MR. KENNEDY: . . . I was surprised to see the financial confidential designation; I thought that we had not designated these as confidential.

MS. SHAPREAU: In any way?

MR. KENNEDY: That's right, but at the time being, we should continue to treat them as financial confidential until we have a chance to get clarification.

by Ms. Shapreau.

Q. Mr. Frasure, just for -- since I would like to go on -- I'm sorry -- so we can go on as quickly as possible, I'm going to just direct your attention to the one page . . .

A. Okay.

Q. . . . I have a very brief question about, but for the record, this is an August 1985 AT and T Dollar

106

Echo document similar to the prior exhibit, Bates stamps P-10714 through P-10725, and I wanted to direct your attention to page five of the document, which is Bates stamps 102 -- excuse me -- 10720, and specifically to the left-hand column under the heading Changes to the Software Agreement, the third paragraph down.

That's the only paragraph I have a question about, so why don't you take the time you need to review that?

A. Are you talking about where it says section two point zero one?

Q. Yes, section two point zero one.

A. (Complied.)

Uh-huh.

Q. Okay, have you had a chance to read that?

A. Uh-huh.

Q. Okay, and I just would like to ask you do you recall reading this particular edition of Echo in August of 1985?

A. I think so; yeah.

Q. Okay. Could you give me some idea what is meant by this paragraph that starts with section two dot zero one?

A. I'd have to look at the -- the software agreement to see what that sentence was.

107

Do we have a copy of it?

Q. Okay, I think we have a copy of it.

Okay, this -- there's a document that's been marked in a prior Deposition as Defendant's Exhibit 25, and I want to direct your attention to this page and thereafter, and that document. . . educational boilerplate. It's soft zero zero zero eight nine.

A. Uh-huh.

Q. Do you know whether that is the document based on the date -- what is the date on that document?

A. The -- indicates a date of 07/01/83, it looks like. I can't really tell if that's a three or a five.

Q. What is the date that it was signed?

A. Eighty-five.

Q. Eighty-five; okay.

A. But I was looking at the -- the revision up here in the -- in the form. It's AT and T Information Systems, so that's -- says 05/01/84 dash 07/01/85 . . .

Q. Okay.

A. . . . which I guess that's in '85.

Q. Do you know whether or not -- looking at the second page of that agreement that's been previously marked Exhibit 25 to paragraph two dot zero one, do you know whether or not that's the paragraph that's referred to in the Exhibit 46 that commences with section two dot

108

zero one?

A. It appears to be; yes.

Q. Okay. Could you give me some idea of what this sentence means in the AT and T Dollar Echo document marked as Exhibit 46?

MR. KENNEDY: Objection to form.

Q. If you -- if you have an understanding as to what the echo document was referring to when it was published in August of 1985.

A. Well, it appears that it's talking, the way I read this, about this last sentence in -- in two oh one little A.

MR. KENNEDY: Could you simply read that sentence into the record?

A. Sure. It says:

. . . AT and T IS claims no ownership interest in any portion of such a modification or derivative work that is not part of the software product.

Q. Okay, and then the -- the phrase in -- and you're reading from the contract, right?

A. Yes, that's correct.

Q. . . .marked as educational boilerplate. Then the -- the -- the sentence in the echo document marked as Exhibit No. 46 states:

. . . The last sentence was added to assure

109

licensees that AT and T will claim no ownership in the software that they developed, only the portion of the software developed by AT and T.

A. Yes.

Q. Period. Does this -- is this sentence related to the earlier paragraph we read in the prior Dollar Echo publication?

A. Yes, I believe this is the -- the next version of the -- the language had -- I believe it had been developed by the -- this publication, and the supervisor responsible for the contracts had went through and given a paragraph by paragraph itemization of the -- of the changes.

Q. So this is just a further discussion of the same issue . . .

A. Yes.

Q. . . . that we earlier talked about in Exhibit No. 46?

A. Yes.

Q. Did you get -- do you know whether AT and T got feedback from licensees during the interim between these two publications on this specific issue of modification and enhancement?

A. Feedback in terms of what?

Q. Questions . . .

110

A. Well, as I said earlier, we always received questions. I say always, I've got to be careful as to how I use that word. A number of occasions we received questions regarding ownership, and that -- again, that's why we put this clarification in there, trying to reduce the number of side letters to licensing agreements that would clarify the ownership issue.

Q. Is there a reason why this came up twice in the span of from April to August in these different issues?

A. Well, what happened was we conducted the -- the seminars in March, and so the April issue is just no more than telling all the things that were talked about at the seminars.

Q. Okay.

A. I made presentations regarding the contracts and language at -- at those seminars, and so the April issue was just no more than stating the fact that this is what happened. And then the next issue, which was dated August, was just -- the language had been developed at that time, to my recollection had been provided as a specimen agreement to a number of licensees for their comments to see if there was, as I indicated before, that we wouldn't raise further clarifications to be required, and we proceeded with revising the contract.

111

Q. Okay. And it looks like this -- there was a new contract being put into -- into place for System Five Unix operating system; is that correct?

A. Well, it was a -- well, the new contract was as is highlighted here in the changes that were -- that were made to it, yes.

Q. Okay, and those were embodied in what's previously been marked as Defendant's Exhibit No. 25, specifically the document entitled AT and T Information Systems Educational Software Agreement, that's E soft dash zero zero zero eight nine?

MR. KENNEDY: Are you asking him whether all of the changes that are referenced in Exhibit 46 were embodied, or just the one change that we've been discussing in section two point oh one?

Q. Just the one change we've been discussing.

A. To my knowledge, and I'd really have to go back and look, but to the best of my knowledge, that --for the one segment that we've been talking about was incorporated in all the different software agreements, be it educational or administrative or commercial.

Q. Okay. And then -- and that's what has been marked as a Defendant's Exhibit. . .

A. It appears that's what it is, yes.

Q. Okay. Okay, Mr. Frasure, I wanted to ask you

112

a series of questions just to get a little -- little background. I know it's been a long time, but I wanted to go back to the meeting at Berkeley and I'm hoping that some of the documents I have will help kind of put some of the pieces together for all of us.

A. Okay.

Q. Actually, before -- before I do that, I want to ask you one additional question, and I want you to hold on to the educational boilerplate, maybe that will help you, but these -- these words come up in all the agreements but this one that you referred to, the educational boilerplate, which is part of exhibit --Defendant's Exhibit No. 25.

During the time that you were employed at AT and T from the '83-'84 time period through 1987, what was your understanding of what encompassed a result of --strike that -- a modification of the licensed software?

A. Well, could be -- a modification could be changing a line of code, it could be adding a line or lines, or it could be deleting lines of code.

Q. Now, could that be distinguished from enhancing? Did enhancement mean something different to you during that time frame?

A. From a view that I took of it, no; enhancement

113

and modification were the same thing. Enhancement was a term that was used to satisfy customers, I guess, in the fact that they felt like they made improvements in the product, but really modifications were the -- were the key things.

Q. Okay. So someone added -- you mentioned adding a line of code. If they added a completely original line of code that they developed themselves to the existing source code, you considered that an enhancement of the . . .

A. Considered it a modification.

Q. . . . software? Or an enhancement?

A. I -- I said I would not consider it an -- I would consider it as a modification.

Q. Okay. Okay. I just want to understand since we're using these terms what the difference is. . .

A. I -- I think the term enhancement -- the only term that has a meaning to me is modification.

Q. Okay.

A. Enhancement is a -- something that you perceive to be an enhancement or an improvement, and it's -- I think that's left up to the -- the originator or the user. Modification is the -- the thing, I believe, that we're after.

114

Q. So if we see enhancement in a license agreement or a letter, what was your understanding that AT and T meant during the time that you were employed by AT and T by the use of the word enhancement?

MR. KENNEDY: Objection to form.

Q. Well, please . . .

MR. KENNEDY: Well, here's my problem. We've seen it in many different agreements, many different contexts, and I don't think that -- I think it creates a very significant potential for confusion on the record to ask for a single definition of what that word meant in various contexts.

Q. Did the definition of the word enhancement in various contracts and side letters -- is it your understanding that the meaning of that word changed from letter to letter or license to license?

A. No.

Q. Okay. And I just want to understand, based on your personal experience working for AT and T, what either you or others at AT and T understood enhancement to mean and how that varied from modification, if you know. A. I can only speak from my, I guess, understanding, or at least interpretation of it, the way I always . .

115

Enhancement was a -- was a term that was --that was -- that was relative. Modification was the --was the key word. Enhancement perhaps could be another word for modification, but I . . .

Q. It could be different as well, under certain circumstances?

A. Yeah, and enhancement is -- I think that's something that's -- that's completely in the -- in the eye of the beholder or the originator. I don't, you know, it's -- it's like modifying a car and the kid says I enhanced it; it goes from zero to a hundred in three seconds, and'his dad says, well, you ruined it, you know.

I mean, it's something that's just relative to the person involved. I think modification is the -- is the key.

Q. Okay. Do you have a recollection in your communications both in writing and oral with The University of California whether you ever communicated with them as to what the meaning of a modification was?

A. Yes, I do.

Q. Okay. And is it anything other than what you've just testified to?

A. I don't believe it was; I believe it was . . .

Q. And -- I'm sorry.

A. I believe it was in accordance with what --

116

what I was just telling you.

Q. Anything additional? Is there anything else that you included in modification other than what you've already testified to that you communicated to The University of California in any way?

A. Well, one thing that I can go back to, I guess, and -- and, you know, we're -- we're talking about a meeting that lasted a number of hours out there -- all afternoon. So it's hard to recall all the specific things that were said.

The only thing I do know is that we went through a number of hypothetical cases or examples of ownership, and if something was developed completely independent of the product without the benefit of the licensed software, it seemed that the ownership issues may be -- may be very clear in that case. But if there's -- if the product was used or the people developing the -- the new product, you know, you can lock them up in a room, but again, they have been exposed to Unix operating systems for a number of years.

We -- I guess it starts to get fuzzy as to where the ownership is.

Q. Okay.

A. You start to use methods and concepts that are - - they have -- you have learned to use or been trained

117

to use or whatever, then we -- we felt like there was a - - an interest in that product.

Q. Okay. So going back to the issue of what was communicated to The University of California regarding what could be encompassed in a modification, is there anything else?

I just want to get the best -- a -- complete understanding of what communication . . .

A. Yeah. To my knowledge the modification . . .

MR. KENNEDY: Excuse me. I just want to make clear we're understanding. You mean is there anything else he can remember saying on the topic of modification other than everything he's testified about modification, at some point during his testimony today?

MS. SHAPREAU: That's correct.

MR. KENNEDY: Okay. Go ahead.

A. I -- I've always felt and I think conveyed to the licensees or whoever we were talking to that a modification was an addition or change to or the deletion from.

Q. Okay. Do you recall any communications you had or were present at that enhancement was discussed with the University and what that meant?

A. (No verbal response.)

Q. I'm wondering if anybody distinguished between

118

the terms during your meetings or communications with the University.

A. I don't recall that.

Q. Okay. And then I would also like to ask you about derivative work, and I'm not asking for a legal conclusion, I'm just asking for your common understanding . of that in your dealings with the University and as an employee of AT and T. Did the definition of a derivative product or work vary in any way from what you've earlier testified is a modification, or is it somehow different?

A. Well, derivative product is a result of the modifications, and we -- I -- I guess I consider the derivative product to be something that you would -- it would be executable or usable in its entire form.

In other words, it's a -- it's a product that will stand on its own, but it's strictly as a result of the modifications that have been made to the -- to the software.

Q. And then the last word I wanted to ask you about is the result is the word you -- you had used earlier . . .

A. Yes.

Q. . . . and I wanted to make sure I understood what you meant by that. The result of research, what

119

would be encompassed in the results to the best of your understanding in the 1983-84 time period through 1987? What did that include?

MR. KENNEDY: As that term appears where? In discussions with people, in documents?

Q. Well, let me ask you this first.

Did a different meaning attach to the word result as we -- as has come up earlier in this Deposition -- did a different meaning attach to the word result in licenses and letters and communications, or was it basically the same understanding with respect to that word?

MR. KENNEDY: Was his understanding basically the same?

Q. Okay.

A. Yeah, I -- I think that's the thing to say, that my understanding of the word result was always . . .

Q. Okay.

A. . . . the same.

Q. And what was -- what was your understanding of the word result?

A. Well, I interpreted the word result the way it was worded in the contract to be the -- the result of an effort that was really non software-related.

In other words, the outcome was not software-

120

related. The computer was used -- the software was used for research purposes and something was discovered as a result of the use of that software, so that was the results of it.

In other words, if you could come to a -- to a conclusion about -- about a -- a bunch of numbers or some research project and you categorize it and you made this discovery and it had nothing to do with -- with the software product itself, it was the -- the software was just processing the data -- the information.

Q. Was it your understanding that it could have included software? That the result could have included software?

A. I again had a -- well, let me just answer the question. No. I -- I have a mindset -- the -- a modification is a modification and that involves three things, and you can add one line of code or a thousand lines of code or ten thousand . . .

Q. You've already told us about that.

A. Yeah.

MR. KENNEDY: Well, yeah, I think you . . .

As long as the records that it's -- he talked about more than just adding code; he talked about other things and I think . . .

Q. Right, and . . .

121

A. Changing.

Q. . . . changing, right.

MR. KENNEDY: Okay. All right. Very well.

Q. I'm not -- I'm just trying to . . .

MR. KENNEDY: No, I understood. I understood, but I just thought that he wasn't done answering. Go ahead.

Q. Okay. Now, did you ever communicate your understanding of what the word result meant to anybody at the University?

A. I don't believe I did, but I believe Otis Wilson did in the meeting that we discussed earlier. The examples of -- of what results have -- what result was.

Q. And you were present at that meeting?

A. Yes.

Q. Okay. And what do you recall he told the University regarding the meaning of the word result?

A. Just similar to what I -- I just described, that if the -- if the software was being used to -- for analytical purposes or to -- to accumulate and process data and make decision on it, that type thing, you know, it may be interfaced to some type of monitoring machine, specific device drivers, but the result of the processing when -- when a discovery was made or something like that,

122

that that result had to be made available to -- to anyone.

Q. Okay. Other than the meeting that you've earlier testified about that happened in 1984 with the University, do you recall any other meeting that you were present at with the University regarding their license for Unix?

A. No, it was the only one.

Q. Okay.

Mr. Frasure, I want you to take a look at what's been marked as Exhibit No. 47, and for the record it's dated July 30th, 1984, and it's a letter that appears to bear your signature to Colleen Schwartz from The University of California. I want you to take a minute to look at that.

A. (Complied.)

Q. You had earlier mentioned in your testimony that the source exchange program limited licensees to exchanging within hardware families essentially; is that correct?

A. For System Five, that's correct.

Q. Is that only for System Five?

A. To my knowledge it was only for System Five.

Q. Okay. Just -- why don't you tell me, is this -- do you recognize this as your signature?

123

A. Yes.

Q. Okay. And do you recall writing this letter?

A. Yes.

Q. Okay. Why don't you tell me very briefly what this letter's about?

A. Well, what we're stating here is that the --the -- the licenses that are required that must be in place before Berkeley can make a distribution of the --of the four -- four point one four point two BSD software to them, source code to them, and . . .

Q. So is this -- so that I understand, you're informing the University that for System Five -- excuse me -- for distribution of four point one or four point two BSD . . .

A. Yes, what -- earlier today -- well, I'll let you ask the question so I don't presume what you're --you're going to ask me.

Q. Okay, this -- the first sentence states:

. . . This is to inform you that licensees desiring to obtain. . .four point one and slash or four point two distribution of the Unix operating system must have a source license with AT and T for the DEC -- D-E-C -- caps -- family of Unix software; i.e., Unix Thirty-two V, System Three, System Five, System Five Release One or System Five Release Two.

124

A. Yes.

Q. To your recollection, is this the first time that you had advised the'University that there was a limitation on hardware families for the distribution BSD code?

A. No. It was not the first time.

Q. Okay. When was the first time, do you recall?

A. Well, the -- no, I don't -- I don't recall, but the Unix licenses were -- were set up for System Five by family -- what we call family types, either DEC, the AT and T 3-B, the Motorola, Intel, National Semiconductor, as we had discussed earlier today.

Q. Do you recall whether there was any response on the part of the University to this discussion of a limitation of distribution of BSD code non-DEC licensees?

A. There was a question whether it could be distributed to them.

Q. Do you remember whether there was any -- well, strike that.

**** Brief Pause ****

Q. I want to give you all the time you need to look at that. I'm going to be making brief points, so I think if you'll cover it, that would be great, but again, I don't want to rush you in any way.

This letter's dated December 17th, 1984, and

125

it is from Mr. Towers to your attention, and it pertains to the previous exhibit, I believe.

Do you recall receiving this letter?

A. Yes.

Q. Okay. Apparently -- well, why don't you describe for me what your understanding of the University's response to your letter of July 30th, 1984 was?

A. Would you restate the question?

Q. Yeah. I'm sorry.

What -- could you just describe for me your understanding of the University's response that's --that's evidenced in this Exhibit 48 to the non-DEC family restrictions on distribution of BSD code?

A. Well, I think there was a -- a -- in Mr. Towers' letter, I think there was a misunderstanding of what we -- what we said. The information that had been provided to us was that the Berkeley Software released four point one and four point two were -- were based on the Thirty-two V license, or the Thirty-two V product --distributed product, and therefore, we weren't putting any -- any type of unilaterally imposed -- well, we weren't changing the Thirty-two V, we were just stating that before anyone can receive a Berkeley distribution, they've got to have one of these licenses.

126

As we had talked about earlier today, that the source code exchange provision allowed you to exchange up, if you will, to a higher-level license, but the higher licensee could not go down. So my reaction to the letter was I believe there was a major misunderstanding of what -- what was attempted to be conveyed here.

Q. Okay, and the second paragraph refers to Thirty-two V license agreement executed -- there's two dates here, October 2nd, 1981 and October 27th, 1981. Do you have any understanding as to -- or do you have any reason to doubt that that's the Thirty-two V license agreement that was at issue in this letter?

A. Based on the -- on the date stated here, I assume it was the Thirty-two V agreement.

Q. But you don't have any specific recollection of that here today?

A. No.

Q. Okay. Okay. Now, during this time frame when this correspondence was taking place, do you know -- do you have any recollection as to whether AT and T and DEC were planning on or had entered into an agreement whereby DEC would offer to the public a binary version of Unix?

A. I'm not sure that I understand your question, 'cause I believe the agreements, you know, sublicensing

127

agreements, were already in place with DEC.

Q. With -- between AT and T and DEC?

A. Yes.

Q. Okay. Do you know whether any -- this time period that we're talking about, the '84-'85 time period, DEC expressed any interest to both AT and T or to Berkeley that they wanted the four BSD version of Unix in order to develop their binary version?

A. What took place between DEC and the school, I mean I really don't know. DEC . . .

Q. But I'm interested in whether AT and T had any understanding. There may have been a three-way communication; I don't know. I'm mostly wondering if you have any recollection.

A. No, the -- the Digital Equipment product that they sublicensed -- I believe they called Ultrix -- was - - was based on Berkeley's four point one or four point. two software, and they were within their contractual right to acquire that software and -- and, you know, make a derivative product that the sublicense. It had nothing to do with us.

Q. Who had a -- I'm sorry.

Who had a contractual right?

A. I mean -- DEC did.

To do what?

128

A. To receive the source code for four dot one or four dot two from Berkeley under the source code exchange provision.

Q. Well, but Berkeley had to agree to what --they had a right to license to whomever they chose?

A. Yeah, but I'm saying that far as AT and T was concerned . . .

MR. KENNEDY: Objection to form. Go ahead.

A. . . . they could receive the source code, because they -- they had the appropriate license in place.

I'm not sure if that's what you're asking.

Q. And they were -- they were -- if -- if Berkeley -- let me strike that. I'll just move on to the next question.

A. I'm left confused, I guess.

Q. Okay.

A. If I said something to confuse you . . .

Q. No, my understanding is DEC, because they were a licensee of AT and T, could have -- they were eligible to receive any version of Thirty-two V . . .

A. That's right.

Q. . . . but the BSD code, which contained Thirty-two V as well as BSD's work, that was something

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that was up to the University to decide who they wanted to license to; is that your understanding from your experience?

MR. KENNEDY: With the proviso that they not license beyond valid Unix source code licensees?

Q. At this time, yes.

MR. KENNEDY: That's the problem I had with your earlier question. You said to whomever they pleased, and I don't think anyone has ever competed with BSD.

Q. No, in this time frame when they were licensing BSD code to AT and T licensees.

It was the University's prerogative to decide whether or not that they were going to license a BSD product to DEC or not. Is that your understanding?

A. Under what agreement?

Q. Under four point one and four point two, during this time frame, the '84-'85 time frame?

A. I'm not sure that I . . .

Q. Let's move on, because you didn't work for the University. I was just wondering -- you wouldn't know what their prerogative was, but I was wondering whether, you know, what your understanding was if DEC wanted to use the BSD version for their binary product, if they had wanted to use that, they would have had to deal with the

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University to get that; isn't that right?

A. That's right; we would not have provided that for them. I guess I just -- I got lost there and still am as to what -- what the questions were about, so . . .

MR. KENNEDY: Is the University contending that with respect to four dot one and four dot two it was free to license that software to some Unix System Thirty-two V licensees but to deny licensees -- deny other Unix licensees the distribution of that software?

MS. SHAPREAU: That's not the issue I'm focusing on. I'm just basically -- I'm trying to understand the background of the non-DEC family restrictions, and that's -- I'm not -- that's not a contention we're raising, but I was just asking the witness his understanding.

WITNESS MR. FRASURE: The -- my understanding . . .

MR. KENNEDY: There's no -- there's no --there's no question pending.

by Ms. Shapreau:

Q. For everybody's benefit, I'm going through a lot of these documents. I just want to try and get a good picture of these documents relating to these non-DEC family restrictions so I have an understanding, but I'm not understanding what was going on at the time.

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I've just handed you, Mr. Frasure, what's been marked as Exhibit No. 49 dated -- the first page is dated September 24th, 1985, and it is a letter from Mary McDonald to Ms. Gertrude Williams of AT and T, and attached to that is a marked-up draft of a license agreement, I believe it's the BSD code.

And did you at any time -- do you believe you've ever seen this letter or this marked-up copy of the BSD license agreement?

A. Yes, I believe so.

Q. Were you working with Ms. Williams on the issue of getting the license agreement for four point two BSD finalized?

A. No.

Q. Do you know who she worked with, who supervised her?

A. I need to -- let me just scan this for a minute.

Q. Forgive me. At the very last paragraph, it says -- the last full paragraph, that sentence, the last sentence says enclosed are copies of this letter and the enclosures. . .Geoff Green.

A. Yeah.

Q. Okay. I've just got two brief questions on this, so you don't need to become familiar with

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everything unless you want to.

A. Okay.

Q. Okay. I wanted to ask you, there is a page with a heading at the top, Rider Seven?

A. Uh-huh.

Q. Which I believe replaces that notice provision that before the break Ms. Fithian was asking about. It says:

. . . Sublicensing may be implemented using the agreements and procedures acceptable to AT and T for its current release of Unix operating systems, including the use as AT and T deems appropriate of agreements for object code. . . end user accepts by opening the package containing the object code.

Do you recall any communications while you were employed at AT and T from the '83-'84 time period to '87 regarding the enforceability of shrink-wrap licenses? A. Do I recall conversations with who, with the University?

Q. No, with anybody at AT and T regarding the enforceability of those licenses. MR. KENNEDY: You may answer yes or no.

A. Yes.

Q. Okay. And without revealing any attorney/client privileged material, could you tell me

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the substance of those conversations?

A. I was I guess in a -- trying to get educated on the subject from the AT and T attorneys and what -- I guess what the current law was and interpretation or --or whatever the right words are was that when someone opened a shrink-wrap agreement, you know, the way the license was presented and so on. So, you know, we had a number of discussions about that, and I was -- like I say, trying to get educated on the subject.

We provided those -- the licensee -- the sublicensee the ability to use shrink-wrap agreements where they were enforceable.

Q. Was there any discussion that you recall regarding whether or not they were enforceable, they meaning shrinkwrap licenses?

MR. KENNEDY: You may answer yes or no.

A. No. I don't recall that. I . . .

Q. Was there an assumption that they were enforceable, in terms of the discussions you -- you were involved in?

MR. KENNEDY: Could we hold on just a second?

MS. SHAPREAU: Sure.

MR. KENNEDY: Had you finished your prior answer?

A. I just answered no, I didn't.

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MR. KENNEDY: Right.

A. . . know. I was -- I was told they were enforceable.

Q. Okay. Who told you that?

A. The attorneys.

Q. Do you remember having any conversations with anyone at the University regarding the enforceability of shrinkwrap licenses?

A. No.

Q. Okay. And then I wanted to address your attention to the very last page of this document which is seven -- sub-A on sublicensing. Apparently in the University's marked-up copy they were trying to add I believe this language to the four point two BSD contract, and it's -- why don't you read the subparagraph A and give me your understanding of this if you can as you -- if you can recall as you read it in the -- in the 1985 time period when you got it?

A. Uh-huh.

MR. KENNEDY: I'm having real trouble following. Where are we, now?

Q. I'm sorry; the very last page of this exhibit. It's seven little a . . .

MR. KENNEDY: Oh, okay.

Q. Just that first paragraph, and again, I'm

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focusing on this non-DEC family distribution issue.

MR. KENNEDY: Could -- could we go off the record for just a minute?

**** BRIEF PAUSE ****

by Ms. Shapreau:

Q. Mr. Frasure, could you give me your understanding of what the University was proposing in paragraph seven small A on the last page of Exhibit 49?

A. Yeah; let me read it.

(Brief Pause.)

They were -- they were trying to restrict AT and T and -- in who -- if we used the -- the four point two BSD enhancements, modifications in our product distribution, then they wanted to -- the University wanted to restrict AT and T as to who that product could be sublicensed to.

Q. So AT and T initially, as we started this discussion of non-DEC family restrictions, was telling the University that they couldn't distribute beyond the DEC family their BSD code, and they wanted to make the reciprocal restriction to AT and T that if AT and T had the BSD code, you -- AT and T couldn't then distribute to non-DEC families?

A. That's correct.

Q. So this is kind of a reciprocal restriction?

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A. Uh-huh.

MR. KENNEDY: Well . . .

Q. Mr. Frasure, I've just asked you to look at what's been previously marked as Exhibit 44, which is a document dated November 4th, 1985 from you to Mary McDonald, and it appears to be responding to the prior exhibit. Is that your understanding?

A. Yes.

MR. KENNEDY: Forty-four responds to forty-nine?

A. Forty-nine.

Q. That's . . .

We're clear now.

MR. KENNEDY: Is that right, Mr. Frasure?

A. Yes, that's right.

MR. KENNEDY: Okay.

Q. Now, directing your attention to the second paragraph where you state that this proposed paragraph seven which you have just talked about in the prior exhibit was unacceptable because it limited AT and T sublicensing rights, what did you mean by that?

A. Where are you reading in that?

Q. I'm sorry. Maybe I could ask it another way. Does the first sentence of the second paragraph basically confirm what we just discussed, that

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AT and T -- I'm sorry. I'd rather that you tell me.

The second paragraph, the first sentence - could -- do you recall what you meant by that -- by that sentence?

MR. KENNEDY: You're referring to the sentence:

. . .Your revised paragraph seven of the proposed agreement is unacceptable to AT and T because of the limitation on AT and T's sublicensing rights.

Q. That's correct.

Thank you, Mr. Kennedy.

A. I'm not sure what you're asking me. The sentence says what -- what we found was unacceptable to AT and T.

Q. Okay, and it was unacceptable because it limited AT and T's sublicensing rights?

A. Yes.

Q. And how did it limit AT and T's sublicensing rights?

A. Well, the proposed language, as I recall reading it here a few minutes ago, said that we could not sublicense a product unless -- let's go back and read it. . . . To only those parties to whom the University may under present or future terms imposed by . . .license releases of four BSD.

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MR. KENNEDY: Mr. Frasure was reading from Exhibit 49.

A. So I interpreted that to mean that we could not provide the product to -- to anyone other than what the University could provide a product. Q. Okay, and then there's a sentence in the middle of the second paragraph that starts with such, says:

. . . Such a limitation by the University would be inconsistent with AT and T's requirement that the . . .research, including software enhancements and modifications from the educational use of AT and T software be made available without restriction by an educational licensee if they are made available at all.

What is your understanding of what that sentence means, if you recall? You wrote this letter in 1985; if you recall what you meant at the time, I would be interested in that.

A. Well, the educational agreement, as we talked about earlier, provides for the distributing to the appropriate licensee of -- of any modifications to the -- to the software. If we're talking about a binary product, if AT and T was to receive the four point two BSD source code and incorporate it into a -- a product,

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then it would have the right to -- to sublicense that --that product. So, in other words, the software agreement that the University entered into said that if they made the code available, that it would -- it would have to be made available to another -- to another appropriate licensee -- appropriately licensed licensee.

Q. Regardless of the hardware family? Is that the point that you were making?

A. No. Remember those -- the agreements have evolved in the hardware family evolved with the System Five product, so you know it depends upon what -- what agreement or set of agreements that you're -- that you're looking at.

Q. Was it your understanding throughout your employment at AT and T that the fruits of research by licensees, particularly educational licensees, including software enhancements and modifications, if they were going to be made available at all they should be made available without restriction to other AT and T licensees?

MR. KENNEDY: Objection to form.

A. If they were appropriately licensed, they should be made available to them, yes, upon request.

Q. Now if -- if there was an AT and T licensee

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who didn't have a license for DEC family and they wanted to obtain the BSD product, do you know how much they'd have to pay to get a DEC family license from AT and T?

A. I don't recall. There was -- excuse me. There was various schedules that if you were a -- a System Five licensee, say for -- for the AT and T 3-B and you wanted to obtain a -- the DEC version of that, then there was a -- a fee to be paid, but I don't recall what that fee is.

Q. Okay, Mr. Frasure, I just handed you a letter dated February 26th, at least stamped dated February 26th, 1986. It appears to be maybe a side letter agreement that's signed by Mr. Wilson, and it's to the Regents of the University of California.

Why don't you take a minute to -- to look at 16 that?

A. I remember the letter.

Q. Oh, you do remember the letter? Okay.

Why don't you tell me what this letter is about?

A. Well, it gave the University the -- the right to provide the BSD versions, at -- at that time it was for four one, four two and the potential four three to any System Five licensee, regardless of the -- the family of code.

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Q. Okay. So they -- in the end of this -- this negotiation period, the University was free to distribute its product, which contained Thirty-two V, to any AT and T licensee, regardless of hardware family?

A. Up through the -- the System Five releases, yes.

Q. Okay.

A. . . . that were -- that were specified in I think some of the earlier correspondence the release zero one and two.

Q. Because you testified earlier that there was a limitation by family, and so I wanted to just --obviously it's been a long time, and I . . .

A. Well . . .

Q. . . . wanted to clarify that point.

A. The -- the limitation that I -- that I talked about before was the interchange of source code between System Five licensees. In other words, I knew all this had happened. I knew this was where you were going, but between the interchange of -- of the source code between System Five licensees, in other words, if someone had a DEC System Five license and they had made a -- a drive to work out of it, they could not exchange it with a 3-B licensee unless they upgraded their contract to receive that.

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MS. SHAPREAU: Okay.

Why don't we take a break?

**** BRIEF RECESS ****

by Ms. Shapreau:

Q. Okay, take a look at page 000215, that's the Bates number . . .

MR. KENNEDY: Of Exhibit 34.

Q. . . . of Exhibit 34.

Thank you, Mr. Kennedy. I know that this has been -- this specific provision was discussed earlier today, paragraph one point zero one a.

A. Yes.

Q. . . . and I'd like to ask you a specific question.

If a licensee of AT and T during this time frame of '84-'85 -- this is -- and again for the record this is a System Five license agreement that we're looking at -- if a licensee of AT and T developed software which did not contain any licensed software, and by licensed software, maybe I should ask you . . .

My understanding of licensed software, and I would like your understanding is AT and T's source code, could be its object code, its methods and concepts, documentation pertaining to that. Is there anything else

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that you would. include in -- what is your understanding of what was included in the licensed software as used in -- in Exhibit . . .

A. All those things specified in the -- in the agreement. I mean, the agreement makes reference . . .

Q. Right.

A. . . . to the various things, whether be it documentation or whatever, so it's all those items covered by the agreement.

Q. Okay. And why -- you know, I hate to have more than one document going at a time, but maybe it will help us answer this question.

If you could refer in that same packet to page Bates stamped 000243, which is the letter dated May 15th, 1985 from AT and T to The University of California, the definition of licensed software is discussed.

A. Yeah, I see page 243; I don't know where the rest of the letter is.

**** Brief Pause ****

Q. Focusing now on just the words licensed software as a defined term in the System Five license agreement, the document that has been marked as Exhibit No. 51, which is dated May 15th, or stamped May 15th, 1985 signed by Otis Wilson to the Regents states in the middle of it:

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. . . Licensed software means . . .

And this is a clarification -- the letter states it's a clarification; quote:

. . .Licensed software means all or any portion of computer programs, other information and documentation. . .

Little "I" in parens. . .

. . . listed in the attached schedule for Unix System Five, VACS version, and any additional schedule forwarded pursuant to section two point oh three of appendix A, or, -- little two -- furnished to licensee by AT and T or any of its associated companies in conjunction with any provision of support services for any Unix System Five.

So just focusing on this clarification, could you give me your understanding in this time frame of 1985 what specifically comprised the licensed software.

MR. KENNEDY: There's another sentence.

Q. Okay, well, let me read that. The next sentence reads:

. . . Licensee agrees that any modification or derivative work prepared by it that contains any licensed software shall be treated as licensed software hereunder.

Now, I just want to understand what could

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possibly comprise the licensed software. Would that -- could you tell me the components of what your understanding in May '85 would have been included in the licensed software? If you recall what your understanding was in 1985.

A. Licensed software would have been.

Q. Would it have been the source code?

A. . . .would have been the source code or some portion of it, with modifications made to it by the licensee.

Q. Where do -- where do you get the understanding that a modification to the source code falls within the definition of licensed software?

A. It says licensee agrees that any modifications or derivative work prepared by it that contains any licensed software.

Q. Okay.

A. . . . shall be treated . . .

Q. Okay.

A. . . . as licensed software.

Q. Okay. So we're talking about modifications that contain the licensed software as opposed to a hypothetical where somebody could develop -- a licensee of AT and T could develop a product that did not contain any licensed software.

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I'm trying to understand . . .

A. Okay. I'll -- let me go back to my . . .

Q. Go ahead.

MR. KENNEDY: Go ahead. Please answer it, though. I'm objecting to form. Go ahead.

A. I want -- I want to go back to my -- my comments from -- from this morning in that the rest of the agreement needs to be taken into consideration, and that's where I believe the paragraph that I was -- cited this morning, paragraph 408 that has to deal with methods and concepts . . .

Q. Okay.

A. . . . I believe is a key part of the . . .

Q. Okay.

A. . . agreement. And earlier today on several occasions I've use the -- the example, I think, that if - - if someone has been exposed to the source code and has used the source code and then goes off on their own and wanted to develop a product that subconsciously or through rote or whatever the words are developed a product that contained the methods and concepts, techniques that we're using, then it's -- I don't know what the right word to use -- understanding, interpretation or what -- that -- that AT and T would

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have a -- an interest in that product.

Q. Okay. So if -- just so I understand, so that we can go from step to step, I'm just trying to understand.

So licensed software -- your understanding of licensed software in the 1985 time period in the System Five license agreement could include source code of AT and T's; is that correct?

A. Yes.

Q. Okay. And it could include object code of AT and T's as well?

A. Yes.

Q. Okay. And it could also include documentation of AT and T's; is that correct?

A. Yes.

Q. And it also could include methods and concepts of AT and T's included in their System Five product; is that correct?

A. Yes.

Q. Okay. Now, if a -- if a -- a licensee of AT and T developed a product that did not have source code of AT and T's, object code of AT and T's, documentation of AT and T's or methods and concepts of AT and T's, but they had had access to an AT and T license but that their product didn't contain any of the things I've just

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referenced, that product would not contain any quote unquote licensed software; is that correct?

MR. KENNEDY: Objection to form.

MS. SHAPREAU: What's your objection?

MR. KENNEDY: Well, two things. One, to the extent it calls for a legal conclusion; and secondly, in your laundry list of items, you didn't include modification or derivative work, which are terms in the contract which Mr. Frasure has identified as aspects of licensed software under these agreements.

by Ms. Shapreau:

Q. Did you ever . . .

Strike that.

Why don't you look -- a little bit earlier in Exhibit 51, the second paragraph, which states:

. . . Regarding a definition of licensed software in the granting clause, AT and T does not assert any ownership interest in any modification or derivative work made by licensee and does not consider that such definition claims such an interest.

What did AT and T mean by that in 1985?

You earlier had stated that you were familiar with this document.

A. Yes.

Q. Okay.

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MR. KENNEDY: You're asking for his -- his understanding of what AT and T as a company was trying to communicate?

Q. Yes.

This -- what I've just read to you states AT and T does not assert an ownership interest in any modification or derivative work made by licensee. Now, if that . . .

A. That . . .

Q. And my understand, and correct me if I'm wrong, is that if a modification or derivative work did not contain licensed software, which you'd earlier described as source code, object code, documentation and methods and concepts . . .

A. Uh-huh.

Q. . . . then AT and T did not assert any ownership interest in that; isn't that correct?

MR. KENNEDY: Objection to form.

You may answer.

A. Well, I -- I don't think I can answer that --that question with -- with -- with a yes or no. I mean, AT and T, when I was with them, never claimed any ownership in any.

Q. I'm sorry, could you start over?

I didn't hear . . .

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A. When I was with -- with AT and T in the licensing organization, we never claimed -- AT and T never claimed any ownership in a modification to the extent that it didn't include the . . .

Q. Licensed software.

A. . . . the licensed software. So if you added lines of code to the source code product, those lines of 'code belonged to the licensee, and AT and T never claimed ownership . . .

Q. Okay.

A. . . . of -- of those, but it kept -- I think the agreement says to the extent that it doesn't contain the licensed software, so the intent here was that we did not want -- did not want someone using the methods and concepts within the software or using the source code product to develop another product . . .

Q. Okay.

A. . . . to provide to someone.

Q. Okay. So that if an AT and T licensee developed a software that was a modification or derivative work which did not contain source code, object code, documentation or methods and concepts of AT and T's, AT and T did not assert an ownership interest in that product. Is that your understanding -- was that your understanding in May of 1985?

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A. It has no ownership in that portion of the product.

Q. Okay.

A. But it doesn't mean that it's not part of the licensed software, I don't think. I think there's two --two things here that we're talking about, licensed software and -- and ownership, which I think are two completely separate subjects.

Q. So you're suggesting -- why don't you tell me what you . . .

A. No, I just -- the only reason I said that, I felt like you were drawing a conclusion that -- something that I didn't say.

Q. So you're suggesting that an AT and T licensee, if they develop a modification or a derivative work that contains no source code, object code, ,documentation or methods and concepts of AT and T's Unix operating system, that licensee owns the product but there are further restrictions on that -- on that -- the licensee's development?

MR. KENNEDY: Objection to form.

You may answer.

A. No.

Q. So they -- they own that?

A. They own . . .

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Q. That modification or derivative work under those specific restrictions that we've just discussed?

MR. KENNEDY: Objection to form. You may answer.

Q. Do you think it's unclear? Do you want me to re-ask it?

MR. KENNEDY: Well, I -- I think it's -- I --I think that certain things are unclear and very hypothetical, but I do think that you should -- because you're talking about . . .

MS. SHAPREAU: I'm trying . . .

MR. KENNEDY: . . . developing in -- in the air . . .

MS. SHAPREAU: Okay.

MR. KENNEDY: . . . without any . . .

And then, when Mr. Frasure talks about development . . .

MS. SHAPREAU: Okay. I would rather that you not get into a lot of detail here, but -- or we could go outside and discuss it. Maybe I'll just re-ask this question, okay, if there's a problem.

MR. KENNEDY: It's -- it's -- it's your Deposition.

MS. SHAPREAU: Okay. I mean, I want the clarification from you, but I don't want you to assist

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154 the witness in any way with your descriptions.

MR. KENNEDY: I am probably the only lawyer in this litigation who tends to limit his objections to say objection to form. I've read the transcripts of the other Depositions.

MS. SHAPREAU: And I certainly appreciate that.

MR. KENNEDY: I see the continuing.

MS. SHAPREAU: Well, I certainly have not . . .

You've never accused me of that.

MR. KENNEDY: No.

by Ms. Shapreau:

Q. Okay. Okay.

Again, focusing on Exhibit 51, which is the May 15th, 1985 letter, the second paragraph states:

Regarding the definition of licensed software in the granting clause, AT and T does not assert any ownership interest in any modification or derivative work made by licensee and does not consider that such definition claims such an interest.

Now, you were involved with this document at the time of its preparation; right?

A. Yes.

Q. Okay. Just so I understand what your

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understanding was when you were involved in the preparation of this document, if a licensee of AT and T developed a software -- developed a software product that was a modification or derivative work of the Unix System but contained no literal source code, no literal object code of AT and T's, no documentation of AT and T's and no methods and concepts of AT and T's, that portion of the AT and T licensee's product that didn't contain any of AT and T's proprietary information was owned by that licensee; is that correct?

MR. KENNEDY: Objection to form. You may answer.

A. Yes.

MS. SHAPREAU: What's your objection?

MR. KENNEDY: Would you like me to clarify, on the record?

MS. SHAPREAU: If it's lengthy I'd prefer . going out in the hall.

MR. KENNEDY: No, I just simply -- my objection is that it's -- is not consistent . . .

MS. SHAPREAU: Well, I'd just like to correct my questions so that. . .

MR. KENNEDY: I think it's -- I think -- I think it's -- it's not consistent with prior testimony and you were -- rather than accepting the words of Mr.

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Frasure, you were attempting to reduce his testimony to a sound bite that will . . .

MS. SHAPREAU: Okay, this is -- this is not a brief objection. If you want to go out into the hall, I'd be more than happy to talk to you about it.

MR. KENNEDY: Please continue; it's your Deposition. I've made my objection to form. I don't think . . .

MS. SHAPREAU: It's the sound bite objection; right?

by Ms. Shapreau:

Q. I just want to understand what AT and T meant and you meant by this letter in May 15th of 1985?

MR. KENNEDY: He's testified -- I mean, you can ask him about this till doomsday. He's testified extensively about what it meant.

MS. SHAPREAU: Well, I -- I needed clarification on the earlier testimony. I -- I think that there were additional questions that needed to be asked.

MR. KENNEDY: He's -- I think he's answered your question.

MS. SHAPREAU: Okay.

MR. KENNEDY: Was there an answer?

A. I just want to express something. We've --

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we've -- we've gone around here about this question and - - and I -- I feel like there's been perhaps some confusion or interchange of words incorrectly regarding one completely separate subject to me, which is ownership, and the other is licensed software, and the two are not interchangeable, so that was the reason that I attempted to make a distinction before.

Q. Okay. So let me state my understanding of the paragraph we've been discussing based on what you've just said.

That if a licensee of AT and T developed a product that was a modification or derivative work that did not contain any source code of AT and T's or their object code, documentation, or methods and concepts and that was not licensed software, then that licensee of AT and T had an ownership interest in that modification or enhancement; is that right?

A. They -- I think the question gets compounded. They -- I think the software agreement clearly says that those things are -- belong to the licensee and that AT and T has no ownership in those. I think the -- the --to me the license agreement is explicit in providing that -- stating that AT and T claims no ownership in that.

Q. Interest in modifications or derivative works as we've just discussed them?

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A. Yes.

However, I guess I just wanted to point out and I feel this is where we got hung up, was that that's a completely separate subject from the -- from the license -- software license product. So . . .

Q. I don't understand what you mean.

A. Well, the fact that you generate a line of code, you own that code, that's yours. It doesn't mean that it's exclusive of the software product. That's all I'm saying.

Q. Exclusive of the software product?

A. It means it's -- you can take that code out. I guess that it's -- I'm saying . . .

Q. So you could -- you could segregate the code that was . . .

MR. KENNEDY: Excuse me.

Q. I'm sorry. Go ahead.

MR. KENNEDY: I believe you interrupted him.

Q. Forgive me.

A. Now, I just -- ownership, to me is a very clear and distinct subject from the licensed software product. If -- if you generate the code, add code to it then I think, clearly the software agreement and the side letter said that you owned that. That didn't say that it was riot part of the -- the software licensed product.

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Q. So what are you suggesting? You owned it but because it was part of the agreement, what does that --can you tell me the significance of that?

A. Well, I -- I'm just saying I want to make a distinction. I'm not sure where we are going with this. It's just that I'm saying that the ownership belongs clearly to the originator of -- of that code, but it --it could be construed to be part of the software product. I think . . .

Q. Which software product?

You're talking about . . .

A. Under the software agreement.

Q. You're talking about the licensed software?

A. Yes.

Q. I'm not . . .

A. Yes.

Q. Okay. If we could use the same term, that would help me.

A. Licensed software.

MR. KENNEDY: Could I now ask Mr. Frasure to leave the room?

MS. SHAPREAU: Yes.

MR. KENNEDY: Because I do want to make a statement on the record.

MS. SHAPREAU: Okay.

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(Mr. Frasure exited the room.)

MR. KENNEDY: Just briefly. There are a whole host of reasons why I object to this line of inquiry. One is that it is extremely hypothetical; two is that it's calling for legal conclusions. Three is that you're asking for someone to interpret a document as if he were an expert on contracts. And I'm not at all sure that even had he been designated as an expert, that such testimony would be admissible.

What concerns me most, however, is that the University must or should know how it developed its software. It knows or should know whether its engineers had access to UNIX Thirty-two V source code. Whether they used it, referred to it . . .

MS. SHAPREAU: Is this an objection?

MR. KENNEDY: It's . . .

MS. SHAPREAU: I just want to know why we're getting a lecture.

MR. KENNEDY: No. It's because -- it's to try to flush out what's concerning me. I've sat back and let -- let you and Ms. Fithian make your inquiries of Mr. Frasure, virtually uninterrupted, with occasional objections to form; saying nothing more on the record unless I'm invited to clarify it. Now, I'm clarifying it.

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It's one thing to ask this witness, here are some facts to assume. A fact -- assume someone went off in a clean room and did X,Y,Z, or assume that people with access to the code did the following and this is what their final product looks like, would you in your own personal understanding regard that as a derivative work. But you're not doing that.

What you're doing is -- we're playing word games here with words in this contract. This contract means whatever a court construes it to mean. If a court regards it as ambiguous then maybe whatever shared understandings the parties communicated to each other may have some admissible relevance. But I think it's inappropriate and I think it's unfair to continually try to take his forthcoming testimony and reduce it to words that you believe give you an advantage in this case, when you're not taking into account all of the various permutations of what he said.

He said earlier that if -- that you were not free under the agreement -- the University was not free under the agreement, to develop software-- . . .

MS. SHAPREAU: I'd like to just -- before we go any further. I'd like to keep track of the time this is going so that we can add it to the time.

MR. KENNEDY: I'll be done -- I'll be done in

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thirty seconds. . . .--without the benefit of -- with the benefit of Unix.

He's talked about using that software and no attempt has been made to follow that up.

Finally, I want to say one other thing. It shouldn't be a surprise to anyone in this room that not claiming an ownership interest in a portion of code which is developed is a far different cry -- cry from saying that the University has a right to distribute the entire derivative work to non-licensees of USL. And that's what this case is about. This case isn't about ownership interests in lines of code. It's about the distribution of code, which we claim is built upon and derived from AT and T and USL code to non-licensees of USL. I think that -- that I'm just personally frustrated at the time that we have been spending on this issue. And the insistence upon asking the same questions again and again and again, to try to persuade this witness to agree to formulations that you find favorable to your case.

MS. SHAPREAU: Okay. I'd like to respond to your comments. The University certainly believes that these issues are very important. I believe I'm not asking this

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witness anything in an expert capacity. He was there and was involved in the preparation of this letter. I'm entitled to ask him what his understanding was at that time. I think the hypothetical that I was asking him was very similar to the things that he was mentioning during his discussions with the University. I think that it's completely proper. I think it's really inappropriate of you to lecture us on the subject. I don't think that you're right. He was there, he knows what was meant; I'm asking about what he meant. And I don't think there's anything improper.

I mean -- you know, I -- I would really appreciate clarification if there's an objection based on anything that I -- that I said, in terms of form that I could correct because I would certainly like to do that. But I'm not asking for his expert testimony. He's a percipient witness -- so. And I don't want to frustrate you. So, what can I say? I'll do everything I can to reduce your level of frustration. Do you have anything to say Mr. Weitz?

MR. WEITZ: Yes, actually I do. One brief comment, which is that I believe that in your desire to get out the next question, Mr. Frasure is starting words and regularly not getting to quite finish. I think if you would pause a little longer, his answers -- I think

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a lot of his answers are cut off and incomplete as a result of your going to the next question. Sometimes you change your question in the middle and interrupt yourself; that's okay. But sometimes you interrupt him and I think that's a concern.

MS. SHAPREAU: Well, I certainly would --would request that you mention that I wait until he pauses; I try and do that. I certainly don't think that I have interrupted. I wish you would tell me . . .

(Both Parties Speaking At Same Time.)

MS. SHAPREAU: Well, it's hard to determine a pause from an end. And you know, we should encourage him that if he has something to say to say it. I think he's -- might have gotten that feeling that that's what he should do throughout this deposition, because that's come up earlier. So we can mention that to him when he comes in.

MR. KENNEDY: No. No. We're not going to discuss with Mr. Wilson how -- I'm sorry -- with Mr. Frasure any adjustments in the manner of his testimony, other than -- if that's what you're suggesting.

MS. SHAPREAU: I really don't want to interrupt the man. We certainly have not made any effort . . .

MS. FITHIAN: If he feels he's being -- if he

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feels he's getting interrupted, I think it's inappropriate to say . . .

MR. KENNEDY: No, that's not -- we thought you were suggesting is -- is -- what I thought you were saying is that we were going to suggest to him that he tends to pause a lot.

MS. SHAPREAU: Of course not.

MR. KENNEDY: He's entitled to answer it in whatever way he wants to answer it.

MS. SHAPREAU: I just wouldn't want him to be cut off. I don't think he has been. By and large when that's come up, somebody's said something.

MR. WEITZ: Should I ask Mr. Frasure to return?

MR. KENNEDY: Please do.

**** BRIEF PAUSE ****

EXAMINATION of MR. FRASURE by M.S. SHAPREAU, CONTINUED:

Q. Just to wind up, I want to ask you one last question on this point.

If a product developed by a licensee of AT and T, again -- well, why don't I preface this -- start over. Strike that.

I'm referring to Exhibit No. 51, the document that we've been discussing, which clarifies and amends the definition of licensed software.

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If a licensee develops a software product that contains source code, object code, methods and concepts, or documentation of AT and T's, that would not be defined as licensed software; is that correct?

MR. KENNEDY: Objection to form. A. I have to qualify my -- my answer by saying if it was developed independent of the licensed software . . .

Q. Okay. Let me -- I don't want to interrupt you.

A. No. I say if it was developed independent of the licensed software and without benefit of it, then to me that's a -- that is the licensee's product. In other words, if they were completely separate and divorced from this and the people who developed that product didn't have the benefit of the knowledge of this product. I mean there are -- there are companies that developed software products all the time without the benefit of this, and introduce them.

I'm cautious in my answer because I think that it needs qualification. If they had the benefit of the licensed software when they did that, then. . .

I still feel like we're talking about --about two separate things here. One is ownership and one

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is what is the licensed product.

Q. Okay. So focusing on the licensed software, you're suggesting that -- that if an AT and T licensee, by merely having access to the licensed software, even if their -- a product that they developed contains no methods and concepts, documentation, source code or object code of AT and T's, that that product is somehow still licensed software?

A. I don't think I said that. I think we're going to have to get down to . . .

Q. So you . . .

A. . . . perhaps an example.

Q. Okay.

A. That if a -- a company -- a licensee had a facility and people in it that never had -- had used the UNIX source code and they set off and they developed a product on their own, then I -- in my opinion, then AT. and T has no interest in that product.

Q. Forgive me. I don't know that I understand your hypothetical completely. This is -- if an AT and T licensee has a licensed UNIX operating system and they've looked at it and they've worked with it, then they go ahead and develop a product that doesn't have actual source code, object code, documentation, or methods and concepts of AT

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and T's, is it my understanding -- do I understand you to be saying that that licensee's product falls under the definition of licensed software?

A. I don't -- I really don't think that I can answer the -- the question clearly. I guess I have my --it's very difficult to try to answer some of these questions, because I think of the methods and the concepts issue. There's a -- I've used the term at least one time, mental contamination, if you will, of being --being exposed to a product. You know, I think a clear cut hypothetical case would be that if you have a licensee and they have two physical locations and you've got this group out here that's never seen the UNIX source code and they go off and they develop a product, then I would think clearly that that is that licensee's product and AT and T has no interest in it.

However, if the other location that had access to that source code and there were people working on that new product that had worked with the UNIX software to some extent -- I don't know what that extent is because we're talking in general terms here -- then I would think that there's a chance that AT and T would have an interest in that product.

Q. Okay. So that I understand you. What you're suggesting is that if an AT and T licensee has had access

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to the UNIX operating system, such that -- you've used the term mental contamination?

A. Yes.

Q. They've been mentally contaminated, meaning they had some recollection of the UNIX operating system by merely seeing it and working with it -- that AT and T would then have an interest in any product that such a licensee would develop, even if that product contained no actual source code, object code, documentation, or methods and concepts of AT and T's?

MR. KENNEDY: Objection to form. Mischaracterizes testimony. You may answer.

Q. I'm asking -- I'm asking the witness if that's a correct understanding of what he had testified to.

MR. KENNEDY: Same objection.

You may answer.

A. I guess I would answer that question in the fact -- saying that there is a chance that AT and T may have an interest in it. I'm not going to say that --that they do or they don't, but I'm going to say that there's a chance that they have an interest in -- in that product. Yes.

Q. Under what circumstances would they have an interest -- would AT and T have an interest in the

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licensee's product because they had had mental access to the AT and T Unix operating system?

A. Well, I think the fact that they -- they had access to it -- I'm really not trying to be -- to be stubborn with you but techniques, methods and concepts are things that -- that we use in every day life that we have been trained -- we have learned by experience to use. I think that for someone to say, well, we're not using AT and T's methods and concepts is -- is a -- it's a statement that -- someone may think that because they subconsciously aren't aware that they were, but they could be, that's why I have to answer the question by saying there's a chance that they -- they do.

I mean you do things for so long and develop styles and techniques, then for someone to say, well, it doesn't contain AT and T's methods and concepts, I -- I think may be hard to say if someone has worked with a product for -- for some number of -- period of time.

Q. Okay. Assuming an objective person were to determine whether or not the product we've been hypothetically discussing, assuming there were no methods and concepts of AT and T's in the licensee's product, do you think AT and T would have an interest in that licensee's product, if they'd had access to the UNIX operating system?

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MR. KENNEDY: Objection to form.

A. I don't know.

Q. My understanding of what you've just stated is the licensee himself may think that it does or doesn't have a methods and concepts of AT and T in the product. But objectively if it had no methods and concepts -- if the product had no methods and concepts of AT and T's, would AT and T have an interest in that product?

MR. KENNEDY: Objection to form.

Q. I'm just trying to understand what -- what -- what . . .

A. The only -- the only thing that I can go back to is the example I used just a few minutes ago.

If a licensee had two locations and one location had no benefit, no exposure to the source code and they developed a product, then I think the -- the answer is clear that AT and T has no interest in that.

Q. Okay.

A. Based on the -- on the software agreement. However, if their -- the other location that has had exposure to the software and uses the software and some of those same people that were using that software undertake development of another product, all I'm saying is there is a chance. I can't say yes or no. All I can

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say is there's a chance that . . .

Q. Okay. So there's a chance.

A. . . . that AT'and T has an interest.

Q. Okay. So this licensee -- this hypothetical licensee of AT and T's, we're talking about a chance that their product if they've had access to AT and T's licensed software, that their product could have methods and concepts of AT and T's but it might not have methods and concepts of AT and T's?

A. That's true.

Q. In the circumstance where an AT and T licensee has had access to the UNIX operating system and there are no methods and concepts of AT and T's in their product -- in the licensee's product, am I correct in understanding then that AT and T would not have an interest in that licensee's product?

MR. KENNEDY: Objection to form.

A. If it -- if it was that clear, in your example, then I would -- I would say they -- they do not have an interest in it.

Q. Okay.

A. If it was -- if it was that clear. However, my -- in my answers the reason I'm hedging is sometimes I just don't know that it's -- that it is that clear. That's why I'm hesitant to answer with a yes or no.

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Q. Okay. Now, the hypotheticals that we've been discussing . . .

A. Yes.

Q. . . . in the last half hour or so, did you communicate any of those hypotheticals in your meeting with the University in 1984?

A. Yes.

Q. You did?

A. Sure did. Spent quite a bit of time.

Q. Was it a similar discussion that we're having today?

A. Yes.

Q. Okay.

A. Yes. Very similar.

Q. Did you ever communicate to the University what AT and T's understanding of methods and concepts was?

A. I think there were references similar to what I have made here today, of styles and techniques.

Q. You mentioned interface?

A. Yes. Methods, techniques of accomplishing something within the code, sequencing things in a certain manner. Yes, those were discussed and -- and presented to them. We went through hypothetical examples exactly like we did here, where a company has two locations and

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one has not been mentally contaminated and the other is. I don't think that -- I think the answers given in some of those cloudy cases were similar to what I have said here right now. There's a chance that there is -- we can't say yes or no, but there's a chance.

Q. What was the University's. . .

I just want to mention, if I'm ever interrupting you I want you to tell me because I want you to finish your thoughts. Okay?

A. Uh-huh.

Q. Okay. Do you recall what the University's response to this discussion was?

A. Well, I don't know what the University's response was.

Q. Did they express that to you, that's what I would like to know?

A. Well, I believe there were -- there were individuals at that meeting that were -- were in and out. I perhaps sterotypically assumed that they were students because of their attire. But, you know, I think there was some objection to some of our discussions.

Q. Do you remember what those objections were?

A. Well, they -- similar to what your questions have been, I think. You know, trying to make a clear cut definition in our answers where you cannot make a clear

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cut definition. There -- you know, without looking at a specific example, I -- I think that it's hard -- it's hard to say.

MR. KENNEDY: Could we find out from Mr. Frasure if he recalls which of the various hypotheticals that were discussed today, were discussed with the University?

Q. Certainly.

MR. KENNEDY: Which scenarios were discussed?

Q. I hate to have you repeat every hypothetical. Was there any hypothetical that you discussed today that you did not discuss with the University in 1984?

A. I -- you know, we went through I think several. One was -- was a stand alone company as I said, that had no -- no exposure. There was development of a product who -- they -- was in conjunction with someone who had ongoing access to the product. There was development of a product who -- someone -- and I'll go back to the term that Otis and I used to use, was mental contamination of the product that set off on their own and developed a product. And that's where I say there's a chance that AT and T had an interest in the product.

Q. Okay.

A. So I -- I think the only one that's clear cut

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is the -- is the stand alone, if you're looking for an ownership issue or a licensed product issue.

I might add one thing that we did discuss, also, that was in line with this, was regarding the contractors' provisions. I'm not sure if you're familiar with contractors' provisions with the software agreement. That's where -- I had mentioned earlier today -- a licensee perhaps if they did not have the technical staff or whatever, they would license with another company to develop the product for them. They brought them under the scope of the software agreement. Then when that development effort was done, they severed their relationship. We -- in our examples, we did say that there's a -- if that company now and those people that had access to the UNIX code go off--

Q. You mean the contractors?

A. The contractor, yes.

. . .--go off and develop a product that there's a -- there is also a chance that -- that AT and T has an interest in that product.

Q. But if that product contains no source code, object code, documentation, or methods and concepts of AT and T, then AT and T would not have a property interest in that product; is that correct?

MR. KENNEDY: Objection to form.

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A. If it was that clear then I would say there is no interest.

Q. Okay.

A. I'm not sure that it is that clear, that's why we used the example. Again it was a mental contamination, if you will. That company had exposure to -- to the product.

Q. Do you believe there's ever a circumstance where someone has had access to the UNIX operating system and worked with it on a day to day basis, that they could develop a product that didn't contain -- no -- excuse me -- that they could develop a product that didn't contain the methods and concepts contained in the UNIX operating system?

A. Sure.

Q. And then AT and T would not have an interest in that product; right? Is that correct?

MR. KENNEDY: Objection to form.

MS. SHAPREAU: What's your objection?

MR. KENNEDY: Provided it didn't otherwise violate the agreement.

by Ms. Shapreau:

Q. Okay. Well, I don't -- I've asked this question before. You -- you basically -- so that I understand you -- are suggesting that if somebody has had

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access, a licensee or a contractor pursuant to a license agreement has had access on an ongoing basis to the UNIX operating system and they' develop a product that doesn't have source code, object code, documentation, or methods and concepts of AT and T's, then that licensee is free to do whatever they want with that product; isn't that correct?

MR. KENNEDY: Objection to form.

A. If it's that -- if it's that clear, that's right.

Q. Okay.

A. It's theirs.

Q. Okay.

A. Yes.

Q. And obviously that's going to be a factual matter. We are talking in the abstract here, but I'm just trying to get your understanding of the terms of these various agreements and the modifications and clarifications.

A. (Moved head up and down.)

**** BRIEF PAUSE ****

Q. I want you to hold onto the System Five Exhibit.

A. Okay.

Q. Okay. Mr. Frasure, I've just given you a

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document dated August 15, 1984, signed by Mr. Wilson, to the Regents. It references someone named Mr. R.D. Hoffman.

Who's Mr. Hoffman?

A. Mr. Bob Hoffman. He worked for me; he was an account executive.

Q. Did he deal on a regular basis with the University of California?

A. No. He was a back-up person for Gertrude Williams.

Q. Okay. I want to ask you a question about this document, but to answer the question you're going to need to look at Exhibit 34, which is the System Five license agreement, paragraph one point zero one A. It's page P zero, zero, zero, two, one, five. That's the page of the license agreement that I think that this letter refers to.

Let me ask you first, are you familiar with this letter?

A. I have seen the language before. I can't really say that I'm familiar with the letter, but I have seen -- seen the language.

Q. Okay. In the middle of the page the paragraph states:

. . . We agree that the following may be

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considered as part of the above referenced agreements.

We require that provision, such as in section one point zero one A of the referenced agreement. . . .By referenced agreement, this document refers to the July 1st, 1983 UNIX System Five Agreement. . . .The referenced agreement be included in our educational software agreements. Reduced fees are granted based on acceptance of such provisions. By way of clarification, while we do not require that results, enhancements and modifications be made public, we do require that if the material is to be released at all it must be -- made -- it must be available to anyone. Before I ask you a question, I want to direct your attention back to the System Five license under --it's paragraph one point zero one A, sub -- little -- two little Its.

A. Uh-huh.

Q. Which states:

. . Such results, enhancements, and modifications all to the extent that they do not include any portion of licensed software, are made available to anyone, including AT and T and its associated companies without restriction on use, copying, or further distribution.

And then the sentence goes on.

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in I correct in understanding what AT and T meant at the time of this August 15th, 1984 letter, regarding the System Five agreement, was that if a licensee developed their result, enhancement, or modification that did not include any portion of the licensed software, that that product could then be made available to anyone?

MR. KENNEDY: Objection to form. You may answer.

A. I -- I guess. I've read the words here. Would you mind repeating the question or having her read it back?

Q. Would you read it back?

(The previous question was read to the witness.)

A. I guess the term anyone is -- is -- in reading this is my concern. It's referencing the software agreement. I have an interpretation. It's been a number of years since I have seen this language. I guess I have a . . .

Q. Do you remember what was meant by this?

MR. KENNEDY: Excuse me.

Q. Oh, I'm sorry.

MR. KENNEDY: Were you done, Mr. Frasure?

A. No. Go ahead and ask the question. Or yes.

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Go ahead and ask the question.

Q. Maybe I could just focus your answer. I just want to get your recollection of what your understanding of this was in the 1984 time period.

A. Any one -- as I stated earlier today, the results are one thing to me, which are -- are separate from any software modification.

Enhancements and modifications be made public here and available to anyone. I have to interpret this as being another licensee, because it's referencing the software agreement.

Q. Okay. So that I understand you. Your understanding in August of 1984, of the word public and anyone is an AT and T licensee. That's what you're telling me?

A. I've broken it up into two categories and I find it hard to. I think I read this differently now than perhaps I did back then.

Q. I want your understanding at the time, in 1984, if you recall that, sitting here today? A. (No verbal response.)

Q. Is your understanding -- is your recollection that your understanding in August of 1984 was that the words public and anyone as used in this paragraph in

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Exhibit 52 meant AT and T licensees?

MR. KENNEDY: For the reasons he's already testified to?

Q. I don't know what that means. I think the question is fairly straight forward.

A. I don't know.

Q. Okay. Did you ever have any communication with the University regarding your understanding of the words public and anyone in Exhibit 52?

A. Not that I recall.

Q. Okay. Can you describe for me your involvement in AT and T's license -- licensing with the University for BSD code? Did you have much involvement in that?

A. For the transfer of the code to AT and T?

Q. For the license that was in place that allowed the transfer of Berkeley code to UNIX?

A. No. I had -- really had no direct involvement in that. There's -- I believe when the correspondence that we looked at earlier today was addressed to me, but I was not involved in that negotiation.

Q. Okay. Do you know who was responsible in the time period that you were employed at AT and T in the licensing department for ensuring that the terms of the agreement for BSD code were put into place?

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A. What specific parts of the agreement?

Q. (Moved head up and down.)

A. In other words, the agreement as I recall covered things like we would have to provide credit if that was given to us.

Q. That's a good example. What about that one?

A. Okay. Well, there was -- that was outside of my organization. That was the -- that would have been the technical group. That whoever used that -- that code had to provide the acknowledgements in the documentation. I believe the acknowledgements in the code. I think the author's name is in the code. But I had no -- no involvement in that.

Q. So the technical group was responsible for making sure that appropriate credit was given in AT and T products that contained BSD code pursuant to license with the University?

A. Well, the -- the name technical organization is kind of a generic thing. But there was those developers that took that source code if there were any modifications put into the -- to the UNIX product. obviously if they picked up those -- those lines of code and incorporated them and -- and if any of -- additional functions or capabilities were provided as a result of those modifications then they were, as I understood it,

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were to acknowledge those people in the documentation, as well if it was -- if that information was presented AT and T.

Q. How did the people in the technical division of AT and T get that information? Wouldn't they get that from licensing since the licensing had the license agreement?

A. No. The -- what we're talking about is the product itself, not the licensing. In other words, the licensing agreement was in place. The code and any documentation was transmitted to the technical organization within AT and T.

Q. Okay. So the technical organization within AT and T got the BSD license?

A. Well, they were aware of the provisions of the license but they got the code directly from the University.

Q. Do you know who in the technical division would have been responsible in the time period that you were at AT and T for making sure that the credit provision, for example, in the license agreement for BSD code was fulfilled?

A. Well, I don't know the individual. I know the manager of the organization. His name was Mike DeFazio, D-E-F-A -- I think it was Z-I-O.

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Q. Okay. So he would have been . . .

A. He was over the organization that had -- I believe he was over the organization that had that responsibility.

Q. Okay. So to your understanding, your recollection, no one in the licensing department at AT and T during the time you were employed there was responsible for ensuring that the, for example, the term which required proper credit to the University of California for the use of its code. There's nobody in the licensing department that was responsible for ensuring that that requirement was fulfilled; is that correct?

A. Yeah. We -- our responsibility was that we provided the terms of the agreement to the -- to that organization.

Q. And what was the name of that organization, specifically?

A. I don't know. All I know is that -- I recall is generically a technical organization. It was located at -- headquarters at Summit, New Jersey, and it was headed up by Mike Defazio.

Q. Do you remember any of the names of other people in that division that might have had some responsibility for ensuring that the terms of the

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agreement with Berkeley were fulfilled?

A. Specifically, no. No. I recall a number of names of individuals, but I can't say that any one of them had part of the responsibility or all of the responsibility. It's my belief that it fell in Mike Defazio's organization, but beyond that I can't -- I can't tell you any individuals.

Q. Do you know whether any Berkeley Code was ever -- Berkeley code or documentation was ever used in any UNIX product?

A. No. I don't know that. I don't know.

Q. Do you know whether AT and T ever paid the University of California for any of its results, enhancements, or modifications to the UNIX operating system?

A. I don't know. I'm hesitating because . . . Q. Why don't I -- why don't I clarify it, actually?

A. Okay.

Q. Other than the cost of processing and obtaining code from the University of California, do you know whether AT and T ever paid any money to the Regents for its results, enhancements, or modifications to the UNIX operating system, other than the costs of getting that product?

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A. I don't know. And the reason that I'm hesitant is that I have a vague recollection that there was -- there was some type of exchange that was going to occur, but I don't know if that ever occurred. I think there was a discussion about it, but it's vague. I don't have any -- any -- other than I think there was some vague -- I mean there's a vague memory there of something to take place for some -- some fee. I don't really know what it was involved with.

Q. Okay. So you don't have any specific recollection that AT and T ever paid any money to the University of California for its results, enhancements, or modifications other than their cost of reproduction of product; is that accurate?

A. Yes. I have nothing concrete that I can recall.

Q. Do you know why AT and T, during your employment at AT and T, might have wanted any of the code developed by the University of California?

A. No.

Q. Mr. Frasure, I've just handed you document, it's kind of hard to read the date, but it appears to be September, 1985 and it's Bates number P zero, zero, zero, nine, eight, nine, seven. It's to all account executives, subject Kernel Newsletter.

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Do you know what a Kernel Newsletter is? A. (No verbal response.)

Q. Well, first let me ask you, is this your signature on this page?

A. Yes.

Q. Do you remember writing this document?

A. I think so. Yes.

Q. Okay. What's a Kernel Newsletter?

A. I'm trying to recall.

Q. Okay.

A. Let me finish reading the letter here. (Brief Pause.)

I have to assume that it was an internal document that I . . .

Q. Okay. I don't want you to guess about anything. I just want your recollection of the facts.

A. I remember writing the letter. It was important to me that we -- we exchange information. That one account executive in working with a customer would to the best of our ability -- if we developed a side letter, would be made aware of the language that was used and for what reason that it was used. So we weren't continually trying to do -- to develop new ground. Specifically what the Kernel Newsletter was I cannot tell you. I only have to make an assumption about it.

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Q. So you -- do you have any specific recollection on any Kernel Newsletters on issues of modification of any licensing agreements that we've discussed today?

A. What I have a recollection of is that we -- we did -- say we -- I wanted my account executives to disseminate the information to save the new -- any new side letters that were developed with the licensees so everyone was familiar with the language. I don't --beyond how we published. What the Kernel Newsletter was, I can't tell you anything beyond that. I mean I had an objective in trying to do this.

Q. Mr. Frasure, I've just shown you what's been as Exhibit No. 54, which is a document dated January 16th, 1986, written by Mr. Ferrari to your attention. Do you recall this letter?

A. Yes, I do.

Q. This letter states:

. . . . In response to your request, this letter is to inform you that the four point three Berkeley Software Distribution, BSD, is based on UNIX Thirty-two V, as have been all previous BSD releases.

A. Yes.

Q. Why was -- what was the request that AT and T made to the University of California referenced in this

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letter?

A. What was the request?

Q. Yes.

A. I specifically can't tell you. I thought there was a -- I had made a reference this morning to the fact that -- that Berkeley had notified us that the four point three was based on Thirty-two V. I thought I read something here this morning that said to the extent of the next release, or something. I don't recall what I read this morning. I think there was reference to it here some place that I read. That future releases to the extent that they contained Thirty-two V or something. But I don't recall the vehicle of the request. I feel certain that -- that it must have been in writing. But we're wanting something back from the University to know what the product contained, whether it was -- if it included any System Three or any System Five source code -- source code products.

Q. Was that the focus to determine which UNIX operating system four point three is based on?

A. Yes.

Q. Thirty-two V, System Three or System Five?

A. What it contained . . .

Q. So that was the focus, which product?

A. Yes.

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Q. Okay. Why -- why did AT and T want that information?

A. To make sure that if there was to be a recipient of that product that they were appropriately licensed. In other words, at one time, you know, people would -- would call in or the University would call in to verify that someone was -- was a licensee. If it was going to contain something that was beyond Thirty-Two V, we had to ensure that we responded correctly to that.

Q. In this time frame, January 1986; was AT and T the one who was responsible for verifying that someone had an appropriate license to obtain a BSD product?

A. I . . .

MR. KENNEDY: Distributed by whom?

Q. Distributed by the University of California.

A. I don't recall. There was a . . .

Q. Well, you're asking this -- I'm sorry answer your -- answer the question, please.

A. There was a -- a procedure published as -- as I recall. I do not recall the time frame, it's been too long ago. But there was a procedure by which we -- where we discussed the source code exchange provisions that we were to respond in verbal to the licensee, but the licensee had the responsibility to write down the date and the person that they talked to, and so on, so we

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could always trace back and be verified. That procedure was -- was in place. There was also a -- other procedures that required copies of the signature page of the license and other things.

To answer your question specifically who had the responsibility at this time, I can't -- I can't tell you.

Q. Okay. You don't -- you don't recall at this time?

A. I don't recall.

Q. Okay.

A. But our organization did continually get inquiries from licensees.

Q. Okay.

MR. KENNEDY: I believe that document has been marked as an exhibit.

Q. Yes. That's correct. Is that your question, whether or not it had been?

MR. KENNEDY: No. I was just mentioning that I think the document had been . . .

Q. What document?

MR. KENNEDY: That Mr. Frasure my be referring to had been marked as an exhibit.

A. The procedure.

MR. KENNEDY: With the procedure.

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Q. I'm sorry.

Mr. Frasure, you came on board at AT and T shortly before AT and T divested; is that -- is that right?

A. No. It was quite some time before that. I thought.

Q. Okay. Could you just briefly describe for me how AT and T's marketing goals -- because you've had some responsibility in -- in marketing from what you've testified to, how were AT and T's marketing goals changed when AT and T divested?

MR. KENNEDY: Assumes facts not in evidence. You may answer.

Q. Did -- okay, I'll rephrase.

Did AT and T's goals regarding marketing change after they divested?

A. I believe they did; yes.

Q. Okay. Do you remember the date of the divestiture?

A. No.

Q. Okay. How did those goals change?

A. Well, I -- I can't specifically tell you because at -- at the time of the divestiture I was not involved in any marketing activities. Prior to divestiture AT and T and Bell Laboratories and so on made

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-- made things available to -- to companies and to people. Corporations or whatever; I probably should not say people, but to companies on some basis. Then after divestiture we found that we were in competition with those same -- same corporations that may have provided information to previously. So we set out with marketing strategies to try to gain our fair share in the marketplace. I can only speak of the -- the UNIX software licensing and sublicensing. I mean that's all I ever had exposure to in terms of marketing with AT and T. So I really can't say what that effort was before divestiture because my only involvement in it was after the divestiture of AT and T. That's when I went to work for the software licensing organization.

Q. Okay. And just for clarification. You had mentioned earlier that you had no -- you didn't play a role in negotiating. correct me if I'm wrong. I'd asked you earlier some questions about the BSD code and the licenses that AT and T entered into for that code. I believe, and correct me if I'm wrong, that you stated that you didn't have any . . .

A. That I had no direct -- I reviewed the documents and made comments on them but I had no direct negotiation with the University on those documents.

Q. Okay. Who had the direct negotiation with the

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University on those documents?

A. To the best of my recollection it was -- it was Mike Defazio's, again, organization. And we -- we reviewed the documents but they were involved with the basic negotiation of the agreement in conjunction with the attorneys.

Q. So Mike Defazio's department, which you've described earlier as the technical department, they actually were the ones that negotiated the terms of the BSD license agreement?

A. To the best of my knowledge. Mike's organization was technical and he had other -- other responsibilities within his organization. He was an individual over a rather large organization. So he had responsibility for setting up certain business relationships between AT and T and -- and other -- other companies, licensees. His involvement was rather diverse at his level. So, I mean, it just was not strictly a technical organization.

Q. You mentioned that although you didn't have any direct involvement you -- you did it -- went over one of the terms, the credit provisions of the BSD?

A. The what provisions?

Q. The credit provision of the BSD license. Do you have some recollection of the terms of the BSD

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licensing?

A. Yes. Yes. I reviewed the document and commented on it.

Q. Okay. And why were you commenting on the documents?

A. Wanting to make sure that they were consistent with other documents that we had put in place with other licensees.

**** Brief Pause ****

MS. SHAPREAU: Okay. We would like to finish Mr. Frasure's deposition today and we're making every effort to do that. We have noticed depositions for tomorrow morning at 9:30 with Mitzi Bonn. Both Ms. Fithian and myself are catching what we -- what I believe are the only -- taking two flights to get to Greensboro, so we can be there -- making ever effort to be there. I don't want it to be construed that we weren't willing to stay to finish this deposition, because we simply won't be able to get the deposition tomorrow if we don't stop at a reasonable hour in order to catch two airplanes to get there.

I -- I would like an agreement from you if that's possible. You know we could stay here until 9:00 tonight, but we wouldn't be able to find a way to get to Mitzi Bonn's deposition tomorrow, since it's a three and

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a half to four hour drive.

MR. KENNEDY: I'm not sure what you're asking of . . .

MS. SHAPREAU: I just don't want to have -- I want to make every effort to finish. I just don't want there to be an objection from you that we would have any problem with continuing this, if we can't finish today to another time.

MR. KENNEDY: The thing is, I would like to do everything possible to . . .

MS. SHAPREAU: To finish today.

MR. KENNEDY: . . . finish Mr. Frasure, principally because of the location. It is . . .

MS. SHAPREAU: I know. I agree.

MR. KENNEDY: Casting no aspersions upon the fine people of Greenville, you guys are way out there in terms of geography. It's a trek to get out here for everybody, so if we could get it done today. And indeed Mr. Frasure runs a business, so I know that -- he's communicated to me that he would much rather finish today if at all possible.

MS. SHAPREAU: Let's just forge ahead here.

MS. FITHIAN: Yes.

MS. SHAPREAU: Okay.

MS. FITHIAN: Let's see how quickly we can

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get through . . .

MS. SHAPREAU: Let me just try to get through this as quickly as I can.

by Ms. Shapreau:

Q. I wanted to ask you. My understanding is Mr. Wilson signed the contract with the University of California for four point three, BSD. Do you know if that's correct or not?

A. I don't know. I assume he did.

Q. Do you have a recollection of that?

A. I have no recollection. I assume he did.

Q. Okay. Do you know whether he -- did you have any discussions with him regarding the preparation and negotiations of the contract with the University of California for the four -- Berkeley Software Distribution, that four point two and four point three in it?

A. I don't know. Let me see that again, if I could.

Q. Okay. Okay. Why don't I just go ahead and mark this? I only have one. I'm sorry.

MR. KENNEDY: It's okay.

Q. Oh. This one has been marked already. I want you to take a look at what's previously been marked as Exhibit 42. I'm going to try

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to ask you some brief questions.

MR. KENNEDY: I don't think. Forty-two is not the signed agreement.

Q. That's right. That's fine. That's not what my question is about. That's okay. This is a draft, but I'm aware of that.

MR. KENNEDY: Okay.

Q. Okay. Mr. Frasure, could you take a look at page one of this draft agreement and under the witness section, the second paragraph states:

. . . . Whereas the Regents of the University of California is the proprietor and owner of enhancements and additions to Thirty-two B, which together with parts of Thirty-Two V comprise computer programs and documentation entitled Fourth Berkeley Software Distribution, version Four point two BSD, Berkeley software.

Did you personally ever communicate with the University regarding this paragraph?

A. Not that I recall.

Q. Do you know whether -- who else at AT and T might have communicated with the University of California regarding this paragraph?

A. Only in a general -- in general.

Q. I'm interested in a -- in a name of an

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